| “The
transition plan was created as an alternative to two options
deemed unacceptable- selling to outside interests or closing the
firm upon retirement."
"Once
you work that hard to get the firm going, you hate to see it stop.
Even so, the transfer not only of ownership, but also of
control, can not be accomplished without headaches, heartaches,
misgivings and apprehension.
You can’t discount the personal issues involved.
Formulating
the transition plan proved as complicated as any of our projects
for clients over the years. Pressing questions included how much
was the firm worth?, Who would manage the firm upon my
retirement?, Who would be the new owners?, What would be our
timetable? How could associates afford to pay for their stock?
To
address these questions, we hired New York based Dannible / McKee and Associates,
an independent valuator with experience in the A/E industry.
Their approach made the most sense and I talked to a lot of
outside consultants. The decision to hire
Dannible / McKee and Associates spared us of the
tension and acrimony that can accompany valuation.
I really recommend that someone who is going to do this use
an experienced consultant like
Dannible / McKee and Associates; it is really
complex and sophisticated and it takes the emotion out of it.
The
results of the transition program has exceeded expectations.
Not only does the firm have a mechanism for future torch
passing, it also has a firm-wide incentive system. The controlling
principals must run the firm well for the stock to retain its
value. The associates
stand to inherit the legacy and so must be worthy.
The transition plan assures budding talent that, if they
are so inclined and the economy permits, they have a future with
the firm. Clients
like to know their projects will not be jeopardized by an untimely
retirement.”
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